Breaking News: BPCI Advanced Model Year 3 Policy Updates

August 27, 2019October 31, 2019

In our ongoing effort to be the preferred value based care and bundled payment partner for acute care hospitals (ACHs) and physician group providers (PGPs), Fusion5 is sharing the following information provided by the Center for Medicare and Medicaid Services (CMS) regarding new bundles and other changes providers can expect to see in BPCI-A Model Year 3, beginning January 1, 2020.

Outpatient Total Knee Arthroplasty (TKA) Pricing
In response to TKA procedures being removed from Medicare’s Inpatient-Only List (IPO), outpatient TKA has been added as part of the multi-setting Major joint replacement of the lower extremity (MJRLE) Clinical Episode, in addition to inpatient TKA. Since TKA was removed from the IPO List in the beginning of 2018, resulting in relatively fewer outpatient TKAs in the Model Year 3 baseline period, the standard procedure for constructing Target Prices was modified slightly to better reflect the setting mix expected in the Performance Period. Specifically, inpatient TKA Clinical Episodes without Major Complication or Comorbidities (MCC) from 2017 and earlier are selected for conversion to “pseudo-outpatient-TKA” Clinical Episodes, which means their observed Clinical Episode spending is edited to mimic that of an outpatient TKA Clinical Episode during the Performance Period.

For additional information on how MJRLE Benchmark Prices were constructed, please see the Appendix in the Target Price Specifications Model Year 3 document.

Percutaneous Coronary Intervention (PCI) followed by Transcatheter Aortic Valve Replacement (TAVR)
Participants have indicated an increasing prevalence of PCI Clinical Episodes containing a TAVR procedure in the 90-day post-anchor period. The inclusion of TAVR costs in the PCI Clinical Episode is impacting a Participant’s ability to control Clinical Episode expenditures. To mitigate this concern, we will be modifying the precedence rules for this overlapping scenario. Therefore, if a PCI Clinical Episode overlaps with a TAVR Clinical Episode, where the PCI start date is on or before the TAVR start date, the TAVR Clinical Episode will be retained and the PCI Clinical Episode will be canceled, regardless of the participation status of the Episode Initiator (EI) associated with these Clinical Episodes.

Additionally, the cost of TAVR inpatient stays will be carved out of PCI Clinical Episodes to prevent artificially high PCI Target Prices.

Spinal Fusion Clinical Episodes
BPCI Advanced was planning to include three spinal fusion Clinical Episode categories: Cervical, Non-cervical, and Combined anterior posterior (henceforth abbreviated to “Combined”). At the beginning of fiscal year 2018, the logic used to assign MS-DRGs was updated so that some hospital stays that would have been classified as Cervical or Non-cervical spinal fusions prior to the change were classified as Combined spinal fusions after the change; and similarly the reverse scenario occurred. This had significant implications for hospitals’ volume and thus their eligibility to participate in the three spinal fusion Clinical Episodes, including a Physician Group Practice’s (PGP) ability to initiate one of the spinal fusion Clinical Episodes at those affected hospitals.

To alleviate this problem, CMMI has decided to pool the three spinal fusion Clinical Episodes into a single “Spinal fusion” Clinical Episode. Analysis of preliminary MY3 Clinical Episodes demonstrates that using the pooled Spinal fusion Clinical Episode, rather than keeping separate spinal fusion Clinical Episodes, will significantly increase the number of hospitals eligible to initiate Clinical Episodes with Cervical spinal fusion, Non-cervical spinal fusion, and Combined spinal fusion triggers. Under the new pooled Clinical Episode category, the three types of spinal fusion Clinical Episodes will be risk adjusted in a single shared model and will share a single Target Price, which will update based on realized proportions of Clinical Episodes from MS-DRGs in each of the three aforementioned categories.

Part B Drug Exclusions
In Model Years 1&2, expenses from Part B drugs on the CMS Average Sales Price (ASP) list are excluded from Clinical Episode expenditures. In an effort to move more towards total cost-of-care, Part B ASP drugs will be included in Clinical Episodes’ costs and thus reflected in Target Prices for Model Year 3. However, to curb avoidance of beneficiaries requiring high cost drugs and account for clinically unrelated drugs, a limited list of Part B drugs will be excluded. Part B drugs are identified for exclusion for either being high cost (mean costs greater than $25,000) or low volume (billed in less than 41 Clinical Episodes), or clotting factors for hemophilia patients.

In addition to the above exclusions, further Part B drug exclusions will be applied to the Inflammatory Bowel Disease (IBD) Clinical Episode. Treatment for IBD may include drug therapy, and depending on the biologic used, can fall under either Medicare Part B or Part D coverage. The current structure of BPCI Advanced does not include Part D drug costs in Clinical Episodes or Target Prices, making it difficult to account for and control Part D spending. To ensure that BPCI Advanced does not induce perverse shifts in prescribing practices, a list of IBD related Part B drugs will be excluded. We are taking into consideration the inclusion of Part D drugs in future Model Years.

Cardiac Rehabilitation
CMS recognizes the importance of Cardiac Rehabilitation services to improve long-term cardiovascular outcomes for beneficiaries. Cardiac Rehabilitation services are traditionally underutilized and providers may be disincentivized from recommending therapy in the Performance Period if there was limited uptake during the baseline period. To remove disincentives and encourage providers to prescribe Cardiac Rehabilitation services to beneficiaries, CMS will carve Cardiac Rehabilitation/Intensive Cardiac Rehabilitation spending out of Clinical Episode spending in both the baseline and Performance Periods.

The benefits of removing Cardiac Rehabilitation costs from all Clinical Episodes can be two-fold; the potential to improve beneficiary wellbeing and reduce spending via decreased readmissions in the long-term. Major Teaching Hospital To improve the transparency of the method used to classify hospitals as training and research centers for the purposes of risk-adjustment, CMS will replace the Academic Medical Center (AMC) variable with a flag that takes a value of one if and only if a hospital’s intern and resident to bed ratio is at least 25%, starting in Model Year 3. Hospitals that meet this criterion are called Major Teaching Hospitals (MTHs).

Please follow the Fusion5 blog as well as our LinkedIn, Twitter, and Facebook feeds for the latest news on BPCI-A Model Year 3, value based healthcare, and bundled payment programs.

PETER LOUGEE

Senior VP OF Partner Solutions

Peter is a nationally recognized expert on post-acute and value based care. He has held multiple executive positions in operations, sales, and business development, and spent more than twelve years serving as a senior executive at one of the largest nursing home providers in the country. His experience also includes leading the largest skilled nursing company in Texas through the first version of BPCI.

Peter is a proud Texan and graduated from Southern New Hampshire University with a degree in Marketing.

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REMAY

CHIEF HAPPINESS OFFICER

As Chief Happiness Officer, Remay puts the “fun” in functional. Her exuberance and sweet nature bring out the best in the team. She rarely takes no for an answer, and takes charge of getting her colleagues out of their chairs and into the fresh air for regular walking meetings.

She has a Pawchelors Degree in Fetch and is currently working on her PhDog in Lawn Leadership. Remay takes pride in her ability to make anyone smile, and has yet to meet a squirrel she won’t chase.

DAN PAQUIN

CHIEF STRATEGY OFFICER

Dan has significant experience in the healthcare sector, including considerable experience with the Centers for Medicare & Medicaid Services (CMS), including the development of the original Bundled Payment for Care Improvement (BPCI) initiative. He is a widely recognized expert on government healthcare programs, having implemented long-term-care Medicaid programs for the states of Kentucky and Florida.

Dan is also considered an expert in the management and financial performance of Managed Care Organizations (MCOs), and is responsible for developing and implementing corporate strategy at Fusion5.

KATHY KRESS

CHIEF FINANCIAL OFFICER

Kathy has served as a senior financial executive at some of the largest companies in the United States. She is considered an expert in mergers and acquisitions (M&A), corporate strategy development, capital markets, and business restructuring. As a divisional financial leader for Walmart, Kathy was charged with the financial performance of the company’s Consumer, Health and Wellness business.

Kathy earned her MBA from the Stephen M. Ross School of Business at the University of Michigan.

MICHAEL J. LEVOSHKO

CHIEF INFORMATION OFFICER

Mike has more than 25 years of experience as a value based care entrepreneur and innovator. He has held leadership positions in managed care and behavioral healthcare organizations serving the public, private, and employer group sectors. He is also the co-founder and Chief Technology Officer of Senior Whole Health, which was named the fastest-growing privately held company in the United States by Inc. magazine.

Mike studied Mechanical Engineering at Northeastern University and is widely recognized as one of the nation’s foremost thought leaders on healthcare technology.

DENISE GALLAGHER

CHIEF OPERATING OFFICER

Denise has a proven track record of healthcare innovation and entrepreneurship and has served in leadership positions at Aetna, Coventry, AmeriGroup, and AmeriChoice. Her work in healthcare innovation has taken her from Alaska to Massachusetts, and she was instrumental in the success of NHP of Rhode Island, the first Federally Qualified Health Center (FQHC) in the nation.

Denise is also the co-founder of Senior Whole Health, named by Inc. magazine as the fastest- growing privately held company in the United States.

GERALD RUPP, PHD

CHIEF INNOVATION OFFICER

Jerry is a healthcare executive, innovator, and educator with more than two decades of experience developing and administering healthcare-delivery and payment-model reform, including bundled payments. Additionally, Jerry served in an advocacy role at the Centers for Medicare and Medicaid Services (CMS), and was the Executive Director and Vice President of Research at the Institute for Science and Health.

Jerry has served as a professor of anatomy and has authored over 30 peer-reviewed articles. He received his PhD in cell biology and anatomical sciences from SUNY – Buffalo.

SUE CAITO

CHIEF CLINICAL OFFICER

Sue brings over 25 years of clinical experience to the world of value based care, bundled payments, and BPCI. Her focus on innovation resulted in the successful development of a BPCI case-management program within a multi-disciplinary practice that led to measurable improvement in quality outcomes for more than 50,000 Medicare orthopedic patients.

Sue is the author of multiple published articles on readmissions reduction and graduated from Webster University with her degree in nursing.

JAMES GERA

CHIEF EXECUTIVE OFFICER

Jim is a proven innovator and value based care entrepreneur. Prior to serving as CEO of Fusion5, Jim achieved remarkable results as a senior executive at several healthcare organizations. Over the past several years, Jim has focused on programs and opportunities within healthcare reform and has served as chairperson for several CMMI grant reviews.

Jim is also an accomplished musician and received his MBA from the Southern Illinois University at Edwardsville.